Employment Law 101 is a series
designed to give you ideas and help you spot legal issues. It is not a
substitute for a good employment lawyer or
thorough research. For the most current developments in employment law
court cases, try Employment Law Memo
- First in Employment Law.

"Disparate impact" is a legal theory for proving unlawful employment discrimination. However, most actual cases use the "disparate treatment" theory.

Disparate impact is the idea that some employer practices, as matter of statistics, have a greater impact on one group than on another.

A good example, taken from the first US Supreme Court Title VII case on the topic: When hiring laborers, the employer required applicants to have a high school diploma. The diploma requirement screened out vastly more blacks than it did whites. Therefore, there was a disparate impact based on race, even though there was no intentional discrimination.

The Supreme Court said that once the employees proved a significant disparate impact, the burden shifted to the employer to prove that the diploma requirement had "a manifest relationship to the employment in question."

Federal legislation enacted in 1991 says that if the employees prove that a practice causes a disparate impact, then the employer must demonstrate that the practice "is job related for the position in question and consistent with business necessity."

The disparate impact theory can be used whenever there is a large impact based on race, sex, religion, age, or other unlawful factor.

Disparate impact cases are complex (and expensive) because they require the use of experts and involve sophisticated statistical methods.

Age cases: In 2005 the US Supreme Court decided that the disparate impact theory can be used in age discrimination cases. However, these age cases are extremely difficult for employees to win for two reasons. First is that the 1991 legislation that makes things easier for plaintiffs does not apply. Second is that the Age Discrimination in Employment Act (ADEA) specifically permits any "otherwise prohibited" action "where the differentiation is based on reasonable factors other than age."

In the 2005 case a City gave police officers with less than five years service greater pay raises than more experienced officers. Obviously this had a negative impact on the 40-and-over group. The Court pointed out that the City based its decision on seniority, which was a "reasonable factor other than age." Therefore, the City won.